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TOM TAILOR EXCEEDS REVENUE FORECAST

by Susannah Carey and Julia Mönnich — March 01, 2011

German retailer Tom Tailor has reached significant results in the financial year of 2010. The group revenues went up by 15.8% to €347.7m because the company took benefit from its focus on expanding retail space under its own control such as retail stores, franchise shops, and shop-in-shops. Due to this dynamic expansion of controlled retail space and the economic recovery in key sales markets, the group was able to significantly outperform the revenue forecast which especially had been increased in the fourth quarter of 2010, where revenues climbed year-on-year by 26.2%.

Whereas the wholesale segment grew in core markets by 11.6%, the retail segment, consisting of Tom Tailor’s own retail stores and the e-commerce business, increased revenues by 39.5% to €106.7m with the number of the company’s own retail stores having risen by 71 to 158 stores. Just in its e-business sector, Tom Tailor was able to raise revenues by 41.4%.

The company intends to pursue its course of profitable growth vigorously in 2011. The group’s aim remains to expand the share of controlled retail space and thereby earn attractive, sustainable margins. The focus will primarily be on the retail segment, where the group is planning to open a further 60 to 70 of its own stores, as well as further shop-in-shops. Alongside the business expansion in Germany, expansion will be driven in particular in the core foreign markets such as Austria, Switzerland, Benelux and France. Tom Tailor is also examining moves into other attractive foreign markets like Poland or Turkey, for instance. In Russia, where Tom Tailor is already present, the company will open its first showroom in Moscow in April.

For Tom Tailor Denim eleven new licenses are to be added. Moreover, in the second half of 2012, an expansion of the lines is planned, more details were not announced yet. A more elegant, sophisticated Tom Tailor line is possible. “We have laid solid foundations for growth and profitability, and from today’s perspective we consider that doubling revenues to around €700m and EBITDA to around €100 m by 2014 are realistic targets,” said Dieter Holzer, Chief Executive Officer of Tom Tailor Holding AG, on the company’s future development.